Thursday, June 23, 2011

FNPF: worker's last stand?

July 1 might as well as be April 1 or April Fool's Day: because that's the day Fiji workers officially get cheated out of their hard work by the new FNPF board, which plans to reduce pension rates from between 25% and 15% to just 9%.

In recent weeks, the ordinary worker and a range of groups have stood up for their rights and their savings, challenging the so-called reforms. Surprisingly, the Fiji media have been allowed to report the story, even the criticism.

Some good arguments have been made although the submissions are a total charade considering the "reforms" are scheduled to start next Friday. Only in Fiji, eh.

1) The Fiji Island Council of Trade Unions pushed the fact that under the proposed 9%, a retiring member with a healthy standing balance of $50,000 at the end of their working life would merely receive $86.53 per week. It rightly asks: Why the big rush and how can a family live on such small income? The union highlights the fact that if a pensioner passes away after the first year in retirement, he loses all unless he took a joint pension in which case his pension would have been even lower at $80.76 per week. FICTU adds that the figures being used by FNPF to justify it's reduction of the pension reforms is flawed.

2) James Raman was a FNPF board member for 35 years and was on the board when the pension scheme was introduced. An 'oldie,' he says he's had sleepless nights since the pension cuts were announced: "In my case if the reduction is as proposed I will suffer a loss of 64 per cent of my present pension. This kind of drastic cut will no doubt have a traumatic effect on us oldies, both physically and psychologically."

3) Pramod Rae, National Secretary of Fiji's Bank and Finance Sector Employees Union:"We suspect that to a large extent these errors were committed by really an incompetent Board and management and there needs to be a full inquiry, full disclosure as to what went wrong, and to improve on its investment activities. The FNPF itself constitutes, or the funds there constitute, around 60% of Fiji's GDP. We say that that is too large a volume to be restricted to one institution. It is time to de-monopolise FNPF and allow other financial institutions to enter the superannuation market and creating competition will force creativity in investment and looking for higher returns and bring FNPF back to sustainability."

Who is to blame for the state FNPF (or the Fiji National Propaganda Fund as we're calling it) is in? Not the innocent members, who had no control in the $300,000,000 dollars write off for Momi Bay and Natadola, that's for sure.

Coup after coup, diplomatic spats after diplomatic spats - from the father who goes down thousands of metres underground at the gold mine at Vatukoula to the mother who after sending her three kids off to school takes herself to work, it is the workers who have contributed every cent to their only form of retirement savings via the FNPF. It is the workers who have trusted government after government and FNPF boards to keep their money safe until they reach retirement age.

Since Frank Bainimarama's illegal takeover in 2006, Fiji has slid backwards - internationally, with the loss of aid and opportunities, the devaluation of the dollar, high inflation, loss in millions dollars of worker's superannuation and now these reforms. Could this be the last spade of dirt to finally put Fiji six feet under?

Hi, this is a sorry state of affairs, and a handpicked Board with zero credibility in terms of stakeholder representation does not help.

A clarification though: the failed investments in Momi and Natadola were initiated through a Cabinet meeting of Laisenia Qarase's government. So blaming Bainimarama is only half-sided criticism. Qarase must be held accountable too.

Secondly, the Qarase leadership permitted these investments, after FNPF made a submission to the then Cabinet. In return, Qarase was able to dip into the FNPF to address shortfalls in his Budget, which would otherwise never have balanced. The implications of these for a government, we all are intelligent enough to interpret.

Third, FNPF's wayward spending began with one man - James Ah Koy, who first opened the gates to finance the incredibly stupid decision of investing FNPF funds into TFL, knowing fully well that wireless technology was the way of the future. The writing was on the wall for all emerging telcos such as TFL, with experiences in Australia (Telstra), UK and the US. Rabuka is guilty of sleeping on the job, allowing Ah Koy a free reign on this.

The consequence? We all suffer today. Frank's actions didn't make things any better, but neither did they worsen matters. In fact, the absolute "fingers off FNPF" approach by Bainimarama has actually allowed FNPF to regain some stability.

I hate to say this all, but that's the truth of the FNPF, which began with a success stiry, but in 1996, was allowed to be hijacked by unscrupulous individuals like Ah Koy.

FNPF events are a scam and its time to call a spade a spade. The junta dictator had earlier said on FBCL when momi bay scam was revealed that those responsible will be put on trial. Because the illegal AG is involved in the berry street property sale by millions more for his kickback this scam is swept under the carpet.

The FNPF, Tapoos and Neo Fiji Ltd and FNPF subsidary comapnies responsible for Momi Bay etc must be put on trial for offical corruption, fraud, abuse of office, breach of companies act, breach of FNPF act fiduciary duties of directors, insider trading, conspiracy to defraud and so forth.

Their assets must be seized to recover the loss of millions and bribes found to be recovered.

The illegal puppet master must be put on trial for offical corruption and abuse of office with Tapoos directors.

You're right, lack of "governership" is a prime accelerant to the problem.

You strike me as a sensible sort, so how about facing the facts I wrote and not insinuating that I am a FB defender.

Far from it. I'm giving the facts, let's see if you have the stomach to digest this and debate logically.

It's not a story someone told me mate. It's what I have been observing while I was a student. I'm still in Fiji and continue to watch and learn. That's how I get my facts, not from Bubu's stories in the village.

Oh, and I have never ever donned a uniform, apart from school attire. Far from army types!! With so many wild assumptions in your writing, you surely must be the envy of any economist!

I like the debate about FNPF. As someone who will retire in 20 years I need to ensure that FNPF is still there in 2030.

All over the world, the annuity factor is based on the 2 critical factors. Life expectancy and return on investments. FNPF's rate of return may seem low to some but is comparable to that of most person funds over the long term. Unlike in the developed world where pensions funds make losses every few years and this gets translated to losses in members account, FNPF has been making money. That's why its called the cash cow, except when they booked the big "loss" due to natadolo and momi.

Like expectancy is another important factor. Closely associated with this is the retirement age. In developed world, retirement age is around 65 compared with 55 for fiji. The annuity factor is 100 devided by the difference between life expectancy and retirement age. In the case of fiji is should be 100/(72-55). This equates to around 8%. Anything more means the pensioners are eating their children's funds.

The debate to reduced the pension rate is over 20 years old. No govt made any effort to reduce it to sustainable levels for their own political aims.

I agree that we need to find a workable solution for those who have retired and for those who will retire in the the future. Failure to do that would mean todays pensioners are robbing me and you.

All Bloggers!!! Blame nobody else but FRANK BAININMARAMA and his military thugs. I said previously, they are the Fiji Military Forces but Frank's Military Thugs. They have stolen all the monies from FNPF.

First he dried up the Ministry of Finance coffer, Robin Hood (MPChaudhry) did not have an acceptable solution then, that could be why he was sacked. FBaini could have gone to the National Bank like SLRabuka if it was still around. So, the only place left locally was FNPF.

FNPF is workers' money. Not any government's cash cow. When one reads the submissions it is clear FNPF is lying. Why hide $230 million? What about the interest earned on this amount?

For argument's sake even if the regime and FNPF Board/ management are right that the Fund will be exhausted in 2056 and thats why the time is now to take action, what about a whole lot of fundamentals that are rotting in our country and no action is being taken? The sugar industry is dying - no action. the economy is in a free fall - no action. The regime is NATO - no action talk only.

Isa.....so our FNPF is only whats written on the statement?.....no real money behind left or has benn devalued?......I work my ass off for that money for my pension.....I just want to say that I will get every cent of my money from any of the bastards serving this unelected government....what else is left for these bastards to take??....our balls too??

Another 2 billion reasons to get rid of the Puppet and the Muppet. They have taken 2 billion dollars the Fijians people money and will take it all of it they are allowed to continue with there deceitful deeds of indiscretions.

COMMON SENSE WILL TELL US THAT IN ANY COUNTRY WHERE PENSION FUND EXIST, IT NEEDS A VIBRANT ECONOMY FREE FROM "COUPS" (BIGGEST COUNTRY RISK)+ VIBRANTS EMPLOYMENT SO PEOPLE CAN CONSISTENTLY CONTRIBUTE TO THE INFLOWS (CONTRIBUTION). MEMEBERS ARE LEAST BOTHERED OPTING FOR PENSION BUT LUMP SUM - WHY? LACK OF TRUST AGAIN. THERE ARE MORE OUTGOINGS AND LESS INFLOWS NOW COMPARED TO NORMAL TIMES, SO WHY CAN'T PEOPLE SEE THIS.

INVESTMENT IS A RISK AND THAT IS NO SECRET BUT IT SHOULD BE DONE UNDER NORMAL CONDITIONS AND WHERE LAW IS STILL SUPREME AND JUDICIARY UNCOMPROMISED SO INVESTORS CAN SEE EYE TO EYE AND REALISE WHAT THEY'RE INVESTING IN IS VALUABLE.

CHAUDARY POLICY ON MOMI BAY ON CAPITAL TAX WAS DRACONIAN - HE DID THIS PUIRPOSEFULLY WHEN HE JUMPED INTO BED WITH THE ILLEGAL REGIME. HE PETS HIMSELF AS THE SUPOPSED SAVIOUR OF FIJI'S ECONOMY BUT FRANK * AIYAZ WAS TOO IMMATURE TO CATCH THE CUNNING FOX TACTICS.

MORE IDEALLY MPC TACTIC WAS TO REALLY BRING FIHI TO HIS KNEES, 2000 COUP PAYBACK HAS NOT IRASED HIS MIND ONE BIT - HE IS UNFORGIVING. MPC KNOWS VERY WELL THAT FRANK KNEW ABOUT THE PLANS OF 2000 COUP HENCE WAITED FOR HIS TIME. BY THE WAY HE AL;MOST SUCCEEDED. HE IS LIKE MANY VICTIMS OF 1987 COUP STILL CARRYING THEIR REVENGE AROUND AND AT THE SAME TIME WAITING TO JUMP IN FOR KILL OR SOME ALREADY GONE TO SBED WITH THE ENERMY.

WHERE WAS SADA REDDY, ILLEGAL APPOINTED G", HE WAS DEPUTY & HIS JOB WAS CHIEF OPERATING OFFICER & CHIEF SUPERVISOR OF FNPF, WHAT WAS HE DOING THEN? HE BLAMED SAVE NARUBE INSTEAD. WE ALL KNOW THAT THE GOVERNOR IS THE POLICY MAKER & NOT OPERATOR.

MEMBERS NEED TO TRUST THE LEADERSHIP AND CAPABILITIES OF fnpf STEWARDS AS CUSTODIANS OF THEIR MONEY. FROM 2007 MEMBERS HAVE LOST CONFIDENCE & TRUST IN THIS CURRENT SET UP. WHY? BECAUSE OF THE COUP - FULL STOP! JUST LOOK AT THE CALIBRE AND ksaS OF THE BOARDS & CEO & MGMT NOW. WHAT DO YOU MAKE OUT OF IT. WHAT DOES THESE NEW BOARD MEMBERS KNOW ABOUT THE NITTY GRITS OF FNPF ETC.

GO BACK A FEW YEARS OF THIS COUP - WAS IT EXPOSED THAT CURRENT CEO AISAKE TAITO'S FNPF CONTRIBUTION HAD SHOT UP FROM $800 PER MONTH TO SOMETHING LIKE $5,600 PER MONTH. THE BOY WAS ONLY EARNING $58,000 IN FINANCE, MEMBERS DO YOUR CULCULATION AND SEE HOW MUCH THAT WOULD BE IN GROSS SALARY COMPONENT PER YEAR. TODAY HE IS EARNING 2X MORE THAN PREVIOUS CEO ( PRIOR COUP).

WHAT HAS THIS BOARD & CEO ACHIEVED SO FAR ? ZERO GROWTH MEMBERS. ZERO GROWTH. BUT ONE THING IS CERTAIN THEY HAVE BEEN MISLEADING THE MEMBERS WITH THE "BLAME GAME" AND PLAYING AROUND WITH THE BUFFER FUND & RESERVES. AS MR RAMAN RIGHTLY SAID.

MEMBERS LETS NOT FORGET, MOST OF OUR DIVIDENT FOR US WHO STILL CONTRIBUTING INTO OUR HOPE FOR THE FUTURE - THAT THE KEY HERE IS ALSO INVESTMENT. THE RETURNS FROM ALL INVESTMENT IS WHAT PAYS US. EVEN IF WE HAVE RESERVES IT WILL DRY UP ONE DAY. THAT IS WHY FNFP WILL TAKE SOME RISK IN INVESTING OUR MONIES. NOT ALL INVESTMENTS ARE POSITIVE AND WILL YIELD GOOD.

BUT THE COUP IS A BAD COUNTRY INVESTMENT AND NOT JUST AN INSTITUTIONS.

SO MEMBERS WHENEVER WE HAVE A COUP - THATS THE PRICE WE PAY.

SO WHY CAN'T WE ALL AGREE THAT THE CAUSE OF ALL OUR MISERIES AND ADVERSERIES IS COUPS COUIPS COUPS (87 X2, 2000, 2006)

Prime Minister Commodore Voreqe Bainimarama has told soldiers at Infantry Day celebrations in Labasa that they must not be double minded or listen to stories that bring disunity.

Bainimarama told Northern-based troops that they must be strong and steadfast and that the Fiji military would not be easily moved.

He says soldiers must continue to remember and live by the foundations of the Force – as he has constantly reminded.

Bainimarama adds the military must take the lead in brining peace and removing racism – which has plagued the country for too long.

Bainimarama told the soldiers they must listen to only one voice – that of the Commander - and not be swayed by rumours they hear in villages and settlements.

He says they must abide by the Commander’s Intent - in whatever work they do – and by working together they would succeed in building a better Fiji.

Listen-up everyone....I am the only voice that will be heard,dou rogoca vinaka sara,pure DICTATOR tune,no two way about it...sa da mai vakaloloma.....Why,why?Why?.....one talk motion..everyone listen,if you're right,just listen..just take you gun and shut up.....words from Bainipuakamaramaairyerstakavata!!!Hey!hey..disunity,waraka namaka tiko na disunity o keep on barking for....some one beside you will have an AD on you!!!,and you days will be gone,in the wind!!!!MOCE JO

Taito,sleeps in his office as he has no home ..he is homeless so he need not worry about anyone.Tom Rickets is a disgrace to his friends and community,he will do anything to get in the limelight,from his schooldays infact,he even got married to his class teacher.. Shashi CDPSingh is AJITS boy,they in partnership in a travel company and a yes man to Sandeep C.J PATEL .He is a salesman from old Prouds who knows NOTHING about money matters.Ajit the big CHAROA who Sandeep cant get rid of as he KNOWS too much about dealings of C.J PATEL so it will be a disaster for Sandeep to sack him. All these crooks know what about money,TOM a failed banker,Ajit CDP and Taito ,what a bunch of clowns,maybe a good team for LAUGHING FIJIANS

I don't need to read the whole article on the FNPF , but blind Freddy could see from as far back as December 2006, just what was about to take place in Fiji and with the Pension fund.But the Lord does work in mysterious ways and as Soldiers are happy to survive on bread and butter, this coup has come back to bite them on their own bums and those of their own loved ones as their Pensions have been squandered by the very Regime they themselves have supported since December 2006 !

Now that every single Pensioner and prospective Retiree is affected by this coup, the Soldiers once content to use the excuse "it's our bread and butter" are beginning to realise the gravity of their decision to once support Frank Bainimarama and Aiyaz Sayed Khaiyum and their supporters.It's funny how it is money and not bullets that will determine the outcome of this coup, something I predicted in early 2007.http://solivakasama.wordpress.com/2008/12/21/a-trip-down-memory-lane/http://solivakasama.wordpress.com/2008/03/20/supreme-law-is-the-constitution-not-the-president/http://solivakasama.net/2009/04/28/un-to-halt-fiji-troop-recruitment-rudd/

@Anon 8:09 - I don't think Momi or Natadola were bad investments by either the board at the time or the Qarase government. Those investments would have been worth a lot of money and making a lot of money had they been allowed to be completed according to the plans. Those were first class hotels that would have been the envy of the rest of the hoteliers in Fiji. The reason why they turned into 'bad' investments is solely because of the coup! That pretty much killed the tourism industry and drove out the investors, not to mention devalued the dollar which skyrocketed the costs! Then in comes an incompetent board looking to justify a cleanup and we have all this idiocy. Considering that FNPF has to invest in country and that tourism is our biggest industry it only makes sense to invest in building what could have been the best resort Fiji has ever seen and possibly the Pacific but due to the idiocy and greed of 1 man and his desire to escape being charged for the deaths of the CRW soldiers these investments are now considered bad. I would say that these investments would definitely have been much better than investing in Tappos city or giving loans to an illegal regime, FSC and other money wasting 'investments' thats going on today.

kinoya kid says,@ convolutedexperiment...jest for your info.....the problem at the FNPF is not the making of the coup or the present Govt...it was how the fund and it's policy were made from those who started thinking that we will only live up to 4 to 5 yrs of pemsion than we die out...Dats ridiculers..not taken into consideration that the heath service will be better hence increasing our life span ...we must also congratulate Mr Taito to have the moral courage to bring that up to the attention of the PM and that's the best option to make...Try to get your facts rite....GOD BLESS FIJI

How can a people be so compliant, so incredibly obedient and passive? I almost any other country in the world, military dictatorship or not, thousands would be on the streets claiming their hard earned pensions back. In Fiji, it seems that the grog induced stupor has paralyzed even those who are feeling the pain.

Again, lets clear another miconception about Felix and his board. It was Felix who commissioned the Ernst & Young to do the audit of Natadola accounts. The audit highlighted several abuses and fraud and for which Felix had initaited legal action on behalf of the FNPF members to claim damages. The Board had then hired a chartered accounting firm to do monthly audits until such time the project was completed.

If "Felix Board" was still in place we would have seen the Momi project completed last year and today Momi Marriot would have been in operation.

Tappoo City deal was done and signed in 2003. Who was incharge then? What due diligence was done then to sign such as contract?. The cost just got higher and higher and FNPF had to meet the extra costs. Tappoos always knew the project would never see the light of the day on the initial projections. they hoodwinked the fnpf to get the construction tender as well. once the tender was in bag Tapppoos just kept milking fnpf with sky rocketing costs and acquring far more share of Tappoo city then they invested and are entited to. Someone should be taken to task.

The Fiji National Provident has been making losses in previous years , everyone knew that,...distorted financial statements and KPMG still issued an unqualified audit opinion ...previous govts have been abusing members'funds and now we blaming Bainimarama's govt? i dont think so..what the current Board is currently doing is right for the future of all of us members..otherwise FNPF will be unsustainable and collapse in a few years time, given the low return on investments and high life expectancy of current pensioners..General Reserve is declining..Good work fnpf..but thanx to the previous govts..we're now suffering silently..

The only difference between this illegal government and the previous ones post independence is that this illegal government is running its day to day affairs on FNPF funds. The previous governments did not reduce pension funds or stop lump sum payments like this illegal government. This illegal government is eating all FNPF funds and adding burdens to the future generations of Fiji by loaning left right and center from China, Malaysia, Timbuktu etc.

as much as many may feel differentaly but the current chairman of fnpf is best for fnpf. he is realistic. fnpf is finished and all he is trying to do is to save whatever is left of it. come on lets think logically - what will happen if the fnpf is allowed to distribute pension on current rate. the answer is simple the future generation will either way pay for the stupidity and mismanagement of the past generation. i for one am disgusted with the issues we are currently facing with fnpf but i also know that it is not correct to blame the current board. like it or not mr. kodagoa and mr.karoi are the best two people to head fnpf - both of them are dedicated with strong values and integrity. i know most of you may disagree but this is the reality.

Does anyone know where Fiji Labour Party spokesperson Lekh Ram Veshnoyi is.He has not said a word about changes in FNPF that is about to come.How could he ignore such an important issue which affect the working class people unless or otherwise he still thinks coup is "GOD SENT".

Whoever is defending Felix Anthony and the FNPF Board must be living in timbuktu. We are not blind or deaf. We know when Natadola project was announced its cost was put at $180 million. when Felix Anthony took over the project after the coup, he blamed the former Board for over-expenditure. Why did not Felix (who some claim commissioned the Ernst & Young Report), release the report? Bcause the report which was leaked briefly and reported by television revealed the Natadola project had used about $70 million until December 2006. Then how come under Felix the project cost over $300 million - $120 million more from its original cost? How come the cost of each hotel room ballooned to $1 million (thats how much each room cost based on total project cost)from the original cost of $635,000 that Felix had described as too high and vouched to reduce it. Does Sanjay Kaba of HLK Jacob ring a bell? Mate of Felix who also had his fingers in the pie.

If FNPF thinks its doing the right thing, then release every report, study and investigation reports to the public.

Despite your attempts to put Ajith Kodagoda in a favourable light, the whole of Fiji knows that he is one of the most corrupt person in Fiji.

He sits on boards despite conflicts of interest, and continues to ignore them but pretends to practice good corporate governance.

He is a representative of a foreign government in Fiji and despite this risk to Fiji's national security continues to sit on boards like the FNPF.

How can he be Chairman of FNPF when he is a foreigner holding a Fiji passport for convenience but without any substantial investment in Fiji to prove that he will be here for the long term and not a temporary resident who will eventually join his wife and children in Sydney.

Ajith Kodagoda is a menace to Fiji and deserves to be branded as a mercenary who is working for the illegal Bainimarama regime to fill his own pocket and that of his employer CJ Patel & Co.

Fiji does not need whatever expertise that Kodagoda has, as a bullshit accountant, whose real expertise is in cooking books. Just look at how he has cooked the FNPF's accounts with the Natadola write down, which he will reverse at some time in the near future on the basis of better performance of that hotel, in order to make himself look good and to hoodwink the FNPF members,

Kodagoda needs to be made aware of the consequences of his actions as a mercenary, and how such people are treated when their time comes to an end. Years in jail if he is lucky or a bullet between the eyes.

FYI , Ajith is not cooking the books. The Natadola project had to be written down due to the fact that Impairment losses need to be provided for the books at each financial year end. The Investment Division of FNPF never carried out valuation of all FNPF Investments to see whether the carrying value of each investment (i.e all FNPF investments, from Govt Securities, FDL stocks, ATH shares and other shares FNPF holds, as well as private equity investments)is higher or lesser than the market value of each investment. This never took place until 2009, ,That is why they had to write it down in FY2010. However FNPF have always been carrying out annual valuation of property investments or the purpose of impairment testing...So dont blame Kodagoda, as he was trying to book everything down to make FNPF comply with the International Financial Reporting Standards, which FNPF just recently complied with w.e.f. Fy2010..That was part of the accounting process Bui..So all in all The Board was cleaning the old Board's shits..se vacava Tamana..pls evry1 get your facts right before you say something coz you dont know what's happening inside there..Sa Malo.

Govt must try to reduce operational expenditure and put more money into better use such as capital projects, infrastructure, which improves the living standards in the country..oilei..but neway sa vodi na vosa..ra yavu ulupepa

kinoya kid says,@Anon 4.34pm...For your info....wat have U done for our Fiji....who are U and where did U come from...the military are working very hard in the development of the Nation....wat have you done for this country don't jest smart in finger pointing....don't be a parasite in the community.....God Bless

You obviously do not know Ajit Kodagoda well enough if you are only going by his experience with FNPF for what 2 years now?

He is well known within business circles as a ruthless and mean person, and unethical and immoral for deliberately witholding payments by CJ Patel to their creditors and suppliers and causing financial problems for them while using funds retained to invest and expand CJ Patels business using other peoples money.

You are right in saying the IFRS only came into being from 2008/2009 and from when impairment tests were made mandatory. Impairment test were not manadatory before then so you cannot accuse previous FNPF Boards and management for failing to conduct them because they were not obliged to do so.

Since you are an expert I wish to point however that asset impairment test and marking asset values to market values are not necessarily the same thing.

Again I wish to reiterate that any expatriate who chooses to work with the illegal regime in Fiji for payment and or other benefits is a mercenary, which applies to Ajit, Sharon Smith Johns, Christopher Pryde, Sri Lankan judges etc. They will eventually face justice and punishment like death or a very long prison sentence.

As for locals like Aisake Taito, Jaoji Koroi, Waqairawai and other seniot officers of the FNPF they are criminals for aiding and abettig in the commission of crimes and will also face justice and long prison sentences.